WILLBVILSON

*-l-ro- OENEzRAl. March 27, 1958

Honorable Wflliun & H~?~~oxI Commissioner OfInoufurCO State Board d huuruuo Austin, Texas

Dear Sir: Opinion No. WW-401 Re: Is a county mutual insurance company which writes automobile insurance subject to the automobile, rate and policy provisions of Article 5.01, et seq., Texas Insurance Code? Your reqwat 

## f4ran OptdOn is as follows:

“The last session ofthe Texas Legislature **author** ized county mutual 

### fnrurance companies qualifying towrite casualty lines for &ate-wide operation towrite all lines of automobile insurance. Under Chapter 5ofthe Insurance Code, thewriting d, all automobile insurance. in,thiSState is subject to regulation and control by the Board of **Insur** ance Commissionerr; and the Board fines and promulgates classifications, ratoi.‘nnd 

### policyforms for automobile in-. surance. However, 

### Cwpter 17of the Code makes county mutual insurance compnnieo exempt from operations of co?- tain ofthe iasurmcr l&s ofthis State.

“We ,respectfully request your opinion as towhether a county mutual insurance company writing automobile insurance is subject to the prwinions ofArticle 5.01, et seq., ofthe Texas Insurance Coda, and 

### mwt thereforecomply, with the automobile rating and policy lawo ofthis Stnb, and the regulations ofthe Board of Insurance 

### Comtni.sslonere?’ As pointed out in **your** request, county mutual insurance companies **are** regulated by the provisions ofChapter 17, Texas **Insurance** Code. Section 5ofArticle 17.25 specifically makes county mutual companieo ,rubject tothe provisions ofArticle 5.06 ofthe Code which requires the B~oard to prescribe policy forms for insurers writing automobile insurance in this State. Thevefore. **county mutual**  **insurance** companies writing automobile insurance must use polify forma and endorsements promulgated or ap**proved** by the Insurance bapartment under the provisions af-&ticle 

## 5.06. As tothe portion ofyour request concerning the automobile rate provisions oi Article 5.01, et seq., wo~experience more difficulty in an-Hon. William A. Harrison, page 2 (WW-401)
swering the question. Article 5.01 provides that ‘every insurance company, corporation, interinsurance exchange, mutual reciprocal, association, Lloyds’ or other insurer.

. .writing any form of motor vehicle insurance inthis State’ shall **be** subject to the rates ofpremiums promulgated a.ndfixed **hy** the State Roard of Lnsurance. This **st.ztul:r a-c;-**  thoriaes the St;lte Board of insurance to prescribe and fix .~utomnbile rates within this State, and would appear to require every insurance company writing such insurance to comply with the rates established by the Board. .However, Article 17.22 ofthe Code provides **that** “county mutual insurance companies shall be exempt from the operation ofall insurance laws ofthis State, except as in this Chapter specifically provided.

. .* Throughout Chapter 17certain other enumer.ii.ed st&otzx are made toapply to county mutual companies; but nbw*tiesr in Chap?.er 17are the provisions of Article 5.01, and the other stztuter, authorizing the Board tofix automobile rates and requiring companies lo comp:~y with these rates, specifically made applicable to county mutual insurance companies. Section 1.ofArticle 17.25does authorize county mutual companies qualifying towrite casualty lines for state-wide opera.- tions to “write all lines ofautomobile insurance”. However, this statute does not specifically require county mutuals tocomply with the rates ofpremiums fixed and promulgated by the Roar.+ under Article 5.01. The provision authorizing county mutuals towrite all iincs of automobile insurance was enacted by the 54th Legislature. At the same session. the Legislature amended Article 17.22 and provided specifically that county’mutual companies would be subject to the provisions ofcertain enumerated statutes, butdid not include therein Article 5.01. As the 54th Legislature authorized county mutual companies towrite automobile insurance, it Could have required the companies .to**be** subject tothe automobile rate laws when it amended Article 17.22 ifthat **bad** been the legislative intent. This the Legislature did notdo. Therefore, Section 1ofArticle 17.25 appears to be a naked authorization tothe companies towrite all lines of automobile insurance, without the companies being subject to the automobile rate laws. Article 18.23, dealing with Lloyds’ companies provides that Lloyds’ shall be exempt from the operation ofall insurance laws ofthe State except as is provided in Chapter 18 “or unless it is specifically so provided in such other law that same shall be applicable” to Lloyds’

. As Article 5.01 mentions Lloyds’ dompanies, the .“or” provision in Article 18.23 comes into effect and the Lloydsr companies are subject tothe rating provisions ofArticle 5.01. The same type of statute and construction ofthe statute is applicable to reciprocal exchanges. Article 19.12. However, Article 17.22 dealing with county mutuals does not. have such an “or” clause, and specifically exempts county mutuals from all other insurance laws except those specifically enumerated within the bounds of Chapter 17. Therefore, while Article‘5.01 generally mentions mutual companies and all other insurance companies,writmg automobile insurance within the State, Article 17.22.i~ specific and is an +emption or exception statute to the general law Article 5.01. Walker V.-Meyers, 114Tex. 225, 266 S.W. 499; Cameron v. City ofWaco, 8S.W.Ld 249; Snoddy v. Caz, 5Tex. ,106; 39 Tex.Jur. p. 191, 277. -I..---Hon. William A. Harrison, page 3 (WW-401) Therefore, we are ofthe opinion that (1) county mutual insurance companies operating under the provisions of Chapter 17of the Insurance Code and writing automobile insurance are subject to the automobile policy provisions ofArti.cle 5.06 ofthe Code, but (2) county mutual inswznce companies writing automobile insura.nce are not **subject to**  the automobile rate and premium provisions 

### ofArticles 5.01, et seq., ofthe Code. SUMMARY County mutual insurance companies are subject to the automobile policy provisions ofthe Texas Insurance Code, but are not subject to the automobile rate and premium provisions ofthe Texas Insurance Code. Very truly yours, WILL WILSON Attorney General of Texas

T&J 1. U&h& Fred B. Werkenthin Assistant Attorneys General FBW:dac APPROVED: OPINION COMMITTEE: Gao. P. Blackburn, Chairman Wallace Finfrock Morgan Nesbitt Richard Stone REVIEWED FOR THE ATTORNEY GENERAL BY: W. V. Cieppert